Bogleheads.org

KyleAAA wrote: ↑Fri Mar 24, 2023 12:53 pm Hybrids definitely aren't new or a fad. The Prius has turned out to be one of the most reliable vehicles ever produced. The big car makers have really perfected their hybrid drive trains. The new Prius will even go 0-60 in ~7s, which ain't bad for a gas sipper. It's definitely possible you could get 20 years without a battery replacement if you aren't a heavy driver. That 10 year number seems suspect. Probably more like 15 years. But even with the cost of a new battery you'll save a lot money on gas in the long run.

+1.

I know EVs are getting more hype lately, but from what I've read hybrid technology is more reliable and they're reasonably priced.

Yes, to me tilting is a logical enhancement and extension of the EMH rather than opposing it. Tilts diversify to more sources or potential return and risk than MCW. And yes, to be clear, size itself doesn't seem as significant as other factors, but it does seem to enhance those other factors. I think it goes underappreciated that MCW has it's own inherent tilts, for better or worse. There's many risk-based and behavioral-based explanations for why this, and an investor who has the capacity and willingness to take on additional risk, or the temperament to overcome some of the common behavioral biases that investors fall victim to, can create a more diversified and balanced portfolio than the MCW portfolio Tilted, with respect to what? Balan...

Yes, to me tilting is a logical enhancement and extension of the EMH rather than opposing it. Tilts diversify to more sources or potential return and risk than MCW. And yes, to be clear, size itself doesn't seem as significant as other factors, but it does seem to enhance those other factors. I think it goes underappreciated that MCW has it's own inherent tilts, for better or worse. There's many risk-based and behavioral-based explanations for why this, and an investor who has the capacity and willingness to take on additional risk, or the temperament to overcome some of the common behavioral biases that investors fall victim to, can create a more diversified and balanced portfolio than the MCW portfolio Tilted, with respect to what? Balan...

No. Yield for stocks means dividends, which reduces the share price proportionately, so if the share price drops so does the dividend. VXUS is still a great fund for diversification, but yield for stocks doesn't necessarily mean much. Total return is all that matters.
https://www.pwlcapital.com/the-irreleva ... n-starter/

Yes, to me tilting is a logical enhancement and extension of the EMH rather than opposing it. Tilts diversify to more sources or potential return and risk than MCW. And yes, to be clear, size itself doesn't seem as significant as other factors, but it does seem to enhance those other factors. I think it goes underappreciated that MCW has it's own inherent tilts, for better or worse. There's many risk-based and behavioral-based explanations for why this, and an investor who has the capacity and willingness to take on additional risk, or the temperament to overcome some of the common behavioral biases that investors fall victim to, can create a more diversified and balanced portfolio than the MCW portfolio. I agree, though I think both are l...

alex_686 wrote: ↑Fri Mar 24, 2023 1:14 pm Here is something that I found in under 60 seconds of googling.

https://financetrainingcourse.com/educa ... olatility/

In short, to figure out the diversification effect (a.k.a. The new volatility value) you need to know the volatility and correlation of the assets. You can get a lower portfolio volatility by adding a high volatility asset if it has a low enough correlation.

Nice. That broke my brain in the best way. Yes, both degree of correlation and volatility determine SORR.

Is a more diversified portfolio a better portfolio? Why wouldn't the market want, and move to, a better portfolio? Should we consider weightings by number of companies or by the economic value of the companies? Are you better than the market at evaluating economic value? Just to be clear, the average investor is not the average person, at least not for these purposes. See my representative/average investor post above. Perhaps the marginal price setting investor is another way to look at it. Investing is a highly competitive enterprise. Efficient is not the same as rational. Efficiency does not guarantee an accurate prices, only a price that incorporates all relevant information in the judgement of the market. If you are better at gathering...

Short answer is no. Sequence of Risk returns are tied to volatility. Value stocks have equal or higher volatility than the total market. +1 Many posters on BH have commandeered the term “Sequence of Returns” risk and now use it to pretty much mean “any risk that prevents my portfolio from lasting 30 years”. I would recommending reading one of the many diversification threads. Even assets with 0.8 correlation can help reduce the worst case outcomes. It doesn't even matter if correlations go to 1.0 in a crisis, you have removed the worst outcome of only owning the one that performs worst. It depends on the specifics of the crisis which asset that will be. Exactly. The best way to minimize SW risk is to be thoroughly well-diversified in both ...

Presumably the goal of a more well diversified portfolio is to have a better portfolio. Presumably everyone wants a better portfolio. If markets are efficient, it's hard to see how a tilt is more diversified - the average and therefore the market would move there. Of course, you might be meaningfully different from the representative/average investor, in which case a tilt may well be an improvement over the market portfolio for you, but the bare assertion that a tilt is more diversified does not appear consistent with market efficiency. Everyone can't tilt in the same direction. Markets are only as rational and efficient as the aggregate of all investors. I think all rational investors want an optimal portfolio, but not all investors neces...

If markets are efficient, it's hard to see how a tilt is more diversified - the average and therefore the market would move there. I don't think there's really an expectation that efficient markets will produce the most diversified portfolio for the average investor. The top 500 US companies make up 80% of the MCW of VTI, the bottom 4000 companies make up 20%. Are these weights really the most diversified portfolio a US investor could hold? No they aren't. MCW weights are efficient more than anything else, and reasonably well-diversified. As you said though, they're mostly large cap, which, IMO is their only fairly minor shortcoming. A MCW is inexpensive and low maintenance since it's largely automatically adjusting. But a factor-tilted po...

No bonds at all seems like a mistake. Something like 80% stocks/20% bonds is likely to have very similar returns with much less volatility than 100% stocks.

Forget about the Buffet mantra. Follow the "chicken mantra" which means that the closest thing to a free lunch is diversification, and don't put all of your eggs in one basket. You never want to make a concentration bet on one sector of the economy. Unfortunately if you just hold TSM for US you ARE concentrated. I’ll say it again, that VTI’s top 10 holdings out of 3948 different stocks makes up 21.28% of the entire portfolio. 25.83% of the entire portfolio is information technology. 17.71% of tech holdings in the entire portfolio are in the top 10 holdings. If you throw in BRK it goes up since I’m pretty sure they also hold Apple. If you own the whole haystack you are still sector tilted. Why is it OK to tilt to a sector if that ...

We have the funds...just wondering if that is the best place to put them versus keeping them in our savings account or investing them. This depends on a lot of factors, but mostly the rate on your mortgage, any other itemized tax deductions you may have, and the expected after-tax rate of return on an alternative investment or other savings vehicle, assuming you have sufficient emergency funds. Knowing none of that, I would suggest that you pay off your mortgage aggressively. I would also suggest that you make two payments, but not biweekly: One regular payment on the first of the month when it is due (ignoring grace periods) and one principal payment in the maximum amount you can reasonably afford at the end of the month. You will general...

We have the funds...just wondering if that is the best place to put them versus keeping them in our savings account or investing them. This depends on a lot of factors, but mostly the rate on your mortgage, any other itemized tax deductions you may have, and the expected after-tax rate of return on an alternative investment or other savings vehicle, assuming you have sufficient emergency funds. Knowing none of that, I would suggest that you pay off your mortgage aggressively. I would also suggest that you make two payments, but not biweekly: One regular payment on the first of the month when it is due (ignoring grace periods) and one principal payment in the maximum amount you can reasonably afford at the end of the month. You will general...

Forget about the Buffet mantra. Follow the "chicken mantra" which means that the closest thing to a free lunch is diversification, and don't put all of your eggs in one basket. You never want to make a concentration bet on one sector of the economy. Unfortunately if you just hold TSM for US you ARE concentrated. I’ll say it again, that VTI’s top 10 holdings out of 3948 different stocks makes up 21.28% of the entire portfolio. 25.83% of the entire portfolio is information technology. 17.71% of tech holdings in the entire portfolio are in the top 10 holdings. If you throw in BRK it goes up since I’m pretty sure they also hold Apple. If you own the whole haystack you are still sector tilted. Why is it OK to tilt to a sector if that ...

if you have the discipline and desire to pay extra towards your mortgage then don't bother with bi weekly payments, just pay your desired amount of extra principle each month automatically. Most people who are responsible with money probably prefer to budget monthly instead of per biweekly paycheck. I agree. Rather than bi-weekly payments, I think it makes more sense to increase principal payment with each regular monthly payment. That's what I did for a few years. In early 2022 I actually sold most of my taxable portfolio and used it to pay off most of my mortgage. Since then I stopped making additional principal payments since the remaining balance is so low the interest I'm paying is minuscule. I'm in the process of selling my place, ot...

I'll always maintain some exposure to equities, but when I enter the withdrawal stage it will probably be only about 40%. I'll probably have about 10% in cash and 50% bonds.

To me it doesn't make sense not to have some exposure to equities because anything can underperform for a fairly extended period. We've seen that over the last two years or so with bonds. Someone allocated entirely or mostly to bonds lost more money during that time then someone with a more balanced portfolio. So to me during retirement you want to be thoroughly well diversified in both equities and relatively lower risk assets like bonds and cash.

To me it's too risky and complicated. Total market stocks and bonds already include REITs and mortgage securities that are more well diversified and simpler.

“Buy when others are fearful”. Does it make sense to back up the truck to sector funds such as financials? Seems like a good time to get a huge discount. You might have to sit on it until it rebounds but you would do that with any holding. What would having 10-15% of portfolio in this matter as far as the downside. Could go down more. If it does just DCA into it. Is this any worse or riskier than holding something such as a REIT fund at these percentages? This just doesn't have the feel of 2008-2009 to me, just a crummy market. Don't think this is a blood on the streets moment. If you have a workplace savings plan, just keep investing in the markets at regular intervals. The thing is, we have had three bank failures? Doesn't seem like the ...

The only kind of semi timing I do is to buy what has done poorly recently. Lately that's just about everything, but bonds especially, so I've been increasing that allocation.

I've only done it a couple times, but normal ACH takes about 2 days. I can't imagine why it would take much longer.

CuriousTacos wrote: ↑Tue Mar 21, 2023 7:26 pm

rockstar wrote: ↑Tue Mar 21, 2023 5:37 pm

CuriousTacos wrote: ↑Tue Mar 21, 2023 5:36 pm

lws wrote: ↑Tue Mar 21, 2023 4:28 pm Is the free market dead then?

No, but maybe the current system (with its many government interventions) should be

If we had a true free market, lots of companies would fail.

No argument there

I think it depends how free is defined. To me competitive sports is a fairly accurate analogy. Teams compete, but there are rules and referees and officials that enforce those rules. That's very much how I think financial markets should operate.

dukeblue219 wrote: ↑Mon Mar 20, 2023 7:04 am An awful lot of wealthy people, like the population at large, aren't rational.

This. Just because a fund has significant AUM doesn't mean it's good. Think about how much was lost by crapto investors.

Marseille07 wrote: ↑Mon Mar 20, 2023 3:23 pm

Nathan Drake wrote: ↑Mon Mar 20, 2023 3:20 pm I’d rather protect against the idea that I could be wrong than actually be wrong and suffer the consequences

The “it may not matter” argument holds no weight. Heads you win. Tails you win. Or… heads you win more. Tails you lose a lot.

Can you define what you mean by wrong?

If the US stalls, you realize VT suffers quite a bit too, right?

But VT suffers much less if only the US suffers. Of course the inverse is also true. Correlation also matters. Other markets might rise when the US falls, or they might fall less than the US. As you might know that's what happened last year when US lost about 3% more than ex-US.

Just want to echo the responses of many others. In your situation, if you're reasonably certain you'll live in the same place many years it might make sense to buy. As long as you don't buy more house than you need, you do gradually build up equity, and over the very long-term owning is likely to be a little less expensive overall than renting something comparable. But the difference is likely to be fairly modest, and as others have said renting is significantly more flexible and less risky than owning. Since you have rental you like and can also save/invest, there's no good reason to rush into buying a home if you don't want to. Renting is a fine option. As I've said in numerous other threads, I'm in the process of selling my place and nev...

Marseille07 wrote: ↑Mon Mar 20, 2023 2:03 pm

muffins14 wrote: ↑Mon Mar 20, 2023 1:52 pm To be fair to others, people have been trying to use increasingly simple examples in an effort to explain risks to you, not because they truly believe it’s identical to only choosing stocks with the letter A.

To refine your last example, rather than 1-4 out of 6, let’s agree it’s like betting on 1-6 out of 10.

It was 1~4 out of 6 because we were talking about dice rolls. If the scale was 1~10 instead, then yes it is 1~6 out of 10.

Great, cool, awesome!
Truce, truce, truce!

OK, that seems like a reasonable analogy to me, and yes, many of us do think ex-US is worthwhile, though I also understand the difference might not be significant. I think I'm ready to call truce now. :sharebeer I've been reasonable all along; it's actually the international camp who made unreasonable claims. Such examples include counting US as one country out of 200 (given VT is 60% US, that's understating the size of US) or suggesting that US-only is like buying stocks starting with letter "A." Betting on numbers 1~4 out of 6 numbers *is* a good approximation of the size of being US-only as you finally acknowledged. Yes, while the US is only one country, it's more than 50% of global market share, so it's overly simplistic to s...

Yes it has. Betting on multiple hands is less risky than betting on 1. While AA might be the best starting hand, for any given hand the likelihood of it winning is lower than the combined likelihood of say KK, J10, 88, 1010, 89, 66, QJ, and A2 winning. The less diversified a portfolio is the wider the dispersion of possible outcomes. A globally diverse portfolio has a narrower range of possible outcomes, both good and bad, than a US-only portfolio. No one's telling you not to, just that some people don't think it's worthwhile. And that is fine, that’s your prerogative. I think it’s hard to argue that the expected cumulative returns distribution is likely tighter when mixing multiple investments with similar expectation values and non-perfe...

Yes it has. Betting on multiple hands is less risky than betting on 1. While AA might be the best starting hand, for any given hand the likelihood of it winning is lower than the combined likelihood of say KK, J10, 88, 1010, 89, 66, QJ, and A2 winning. The less diversified a portfolio is the wider the dispersion of possible outcomes. A globally diverse portfolio has a narrower range of possible outcomes, both good and bad, than a US-only portfolio. But the reality is that VT is 60% US anyway. IOW we're talking about betting on numbers 1~4 vs 1~6 of dice rolls. If you think the extra numbers (5 and 6) make a huge difference, go ahead and bet on all. No one's telling you not to, just that some people don't think it's worthwhile. OK, that see...

Say there is a 1% chance in any given year that a country’s stock market is entirely wiped out, and when that happens, you flip a coin to pick which country. If you are unlucky and the US comes up, your entire portfolio is eradicated. That may be worse for your 100% US portfolio than if my diversified portfolio lost Australia and Mexico and the UK and Japan I reject the premise of your thesis. Stock markets do not have 1% chance of getting wiped every year per country. I could try to counter your absurd premise but my response will also be absurd because of that. OK, so instead of 'wiped out' replace that with 'significant loss'. Or 'significant gain' for that matter. The math is still valid. A globally diverse portfolio isn't exposed to s...

Marseille07 wrote: ↑Mon Mar 20, 2023 12:30 pm Suppose you invest US / India / Europe 33% each. Sure, you reduced US risk; but you now took on India risk and Europe risk. The total risk exposure hasn't changed, at least there is no reason to believe it has.

Yes it has. Betting on multiple hands is less risky than betting on 1. While AA might be the best starting hand, for any given hand the likelihood of it winning is lower than the combined likelihood of say KK, J10, 88, 1010, 89, 66, QJ, and A2 winning.

The less diversified a portfolio has a wider the dispersion of possible outcomes. A globally diverse portfolio has a narrower range of possible outcomes, both good and bad, than a US-only portfolio.

You're mis-framing the issue. Ex-US isn't one monolithic entity but the rest of the world, so we don't know how potential crises will affect all the world, including the US. Again, you seem to misunderstand basic probability. Betting on one country to consistently out-perform all others is riskier than spreading that risk over all investable countries. That's just how mathematical probability works. No, it's actually you who don't understand probability. Ex-US isn't monolithic doesn't mean its risk exposure is somehow lower. If you argue US is hit harder than ex-US, that's what you're claiming. If the US is hit harder than the rest of the world, then the US is likely to be more adversely affected. Just like if India is hit harder than the ...

rockstar wrote: ↑Mon Mar 20, 2023 11:15 am Why would a bear market in the US not cause bear markets globally?

As we've explained many times, it depends. There are any number of plausible events that might disproportionately depress US returns more than most other markets. There's also the issue of dispersion. Even if all or most markets are affected, the degree could vary considerably.

Most of the issue you keep raising are discussed in the video, so again I suggest you review it. This would be more efficient since he explains in better detail than we can in snippets.

No, the default stance should be we don't know what will happen in the future since we don't. There's no reason to assume the effects would be 'rather comparable' when they might not be depending on the nature of the crisis. You keep focusing on the past and present, which isn't the future. If a crisis does affect most markets similarly, either a US-only or global diverse portfolio will likely be affected similarly. But if a crisis disproportionately affects the US, a US only portfolio will likely suffer more than a globally diverse portfolio. A crisis that affects other markets more than the US is unlikely to affect all markets equally. Considering all this, a globally diverse portfolio is less risky than US only, though I wouldn't be sur...

Again, that's a crisis we have the luxury of considering with hindsight bias. Even with how interconnected the global economy is, that doesn't mean there could be crisis that would be disproportionately harmful to the US market and vice versa. For instance, a terrorist attack on a major US shipping port would be probably be significantly more harmful to the US than say Holland or Denmark. Keep in mind the Black Swan fallacy. Humans generally seem to underestimate the likely of events that haven't happened, or that haven't happened in their lifetime. Well obviously there could be crisis that would be disproportionately harmful to the US market. There also might not be since everything is interconnected. Since we don't know, you can't argue ...

But depending on the nature of the crises, it might not affect all countries equally. There are all manner of issues I can imagine that would be more harmful for the US market than most others, and of course the converse it true as well. That's the point. If I were acutely clairvoyant and could predict what will have the best returns, that's where I'd invest. As far as I knew, no one has this ability, so global diversification makes sense. It's unlikely to make a material difference as everything is interconnected. 2008 GFC is a good example. The US was the epicenter of the crisis without a doubt, and the matter was highly domestic in nature (US real estate). Yet, ex-US fell harder than US equities. Your globally diversified portfolio didn...

burritoLover wrote: ↑Sun Mar 19, 2023 9:38 am In the longest running funds since Fama and French's 3-factor paper, DFA small cap and small cap value funds have both outperformed the Vanguard 500. This is not a free lunch - higher volatility and higher drawdowns are what you ended up with. As should be expected as both small and value are riskier than the market portfolio.

Considering their volatility, I don't think small caps as a whole are all that beneficial since their returns are only slightly higher. However, it seems worthwhile for SCV, which has average returns about 1.5% higher.

60% of risk vs 100% seems like more than nothing, at least. To each their own, I think No it is big, but remember we're talking about left-tail risk only striking the US here, which is a skewed assumption in the first place. If you believe ex-US countries also carry left-tail risks of their own, then the reality is likely a wash, not US suffering and nowhere else. But depending on the nature of the crises it might not affect all countries equally. There are all manner of issues I can imagine that would be more harmful for the US market than most others, and of course the converse it true as well. That's the point. If I were acutely clairvoyant and could predict what will have the best returns, that's where I'd invest. As far as I know clai...

It could literally be almost anything or things anywhere, hence global diversification makes sense. Not sure how broadly my generalization below holds true, but one thing I'm seeing is a couple different starting points that are actually both understandable. From earlier thread comments, it is probably obvious where I fall as a 40% non-US investor. Starting Point A: The US economy is giant, diversified, heavily influences other economies, and has a system in place that promotes profitable growth for the investor class. Therefore, I do not need to add international stocks to have a strong investment plan for my retirement. Starting Point B: The global stock market is the true investable market portfolio. Therefore, any significant deviation...

OK, tell me how to find the next Tesla or Amazon and we have a deal. I'm passively investing in the US because I don't know how to find them. If you don't know either, please don't suggest something you can't do. Exactly. And the next Tesla or Amazon might be in India or some other non-US country. It might not be that type of prominent company either. It might be a value/small value company or companies that have the highest returns, and of course we can't predict the country or countries they're based in. Or maybe a Japanese or Korean automaker figures out how to efficiently manufacture a reliable, affordable EV that becomes massively popular. It could literally be almost anything or things anywhere, hence global diversification makes sen...

Logan Roy wrote: ↑Sun Mar 19, 2023 7:40 am For everything else, there's TIPS and gold, maybe bitcoin.

Bonds seem like a much better diversifier than the last two.

What if we take the opposite view...that eventually all (or nearly all) public equity investment will migrate to the US? Is this blatantly unreasonable? In the unlikely event that this actually could happen, a global market weight port would still capture it Let's try a numerical example. Suppose that today, the US market is worth 100 units, and foreign markets are also worth 100 units. 200 years later, adjusted for inflation, the US market comes to be worth 2000 units, and the foreign markets, 200 units. To me, this is tantamount to nearly all public equity investment migrating to the US. So what is our rate of return? A market-based weighting today, would put 50% into the US, and 50% foreign. The US portion grows 20X, while the foreign p...

What about the costs of holding international and emerging for US investors? Assuming all returns were suddenly equal, wouldn't holding these simply be just more expensive and therefore not optimal? Eg: it cost 1.01% to hold VWO (emerging markets) and 0.30% to hold VTI (US total market) in 2022. The costs to hold the two aren't that wide. International is more expensive in terms of costs, but well worth it for the wide potential dispersions across markets that can happen multiple times over a lifecycle of an investing horizon. These were the actual results of 2022 which I got the information from the spreadsheet that is commonly shared here on the forums: https://docs.google.com/spreadsheets/d/1owatGsAWQ3Ep60lo25cpLaj7LoH-FtPSXxNPwGuAMk8/e...

I suggest you review the portion of the video where he discusses the lost decade about 2000-2009. Again I don't have time to review right now, but the average annual returns during that time for US stocks was slightly negative, I believe about -2% while ex-US markets returned about 1.5%. All the issues you raise are discussed in detail on the video. Perhaps you should just watch it again? Thanks for the advice. I watched the video multiple times. Ben’s points are intriguing. But ultimately they are contingent on one core assumption: that the US does NOT, in fact, have an overwhelming lasting advantage – an advantage that will persist and in fact flourish, decade after decade, century after century. Ben is assuming that if a time-traveler w...

unwitting_gulag wrote: ↑Sat Mar 18, 2023 4:09 pm What if we take the opposite view...that eventually all (or nearly all) public equity investment will migrate to the US? Is this blatantly unreasonable?

Yes, that's blatantly unreasonable since it seems highly improbable. A more likely future seems to be as other countries develop they'll behave more similarly to developed markets like the US, but that doesn't mean nearly all assets will migrate to the US. Even if markets continue to become more correlated, wide dispersion/variance among different markets is likely to persist, so global diversification would still be beneficial.

I believe Ben has migrated to the greener pastures of Avantis. Maybe, but I don't think it makes a major difference since both have very similar characteristics and returns. https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=4&startYear=1985&firstMonth=1&endYear=2023&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&debtAmount=0&debtInterest=0.0&maintenanceMargin=25.0&leveragedBenchmark=false&reinvestDividends=true&showYie...

Cash is King wrote: ↑Sat Mar 18, 2023 2:32 pm

Apathizer wrote: ↑Sat Mar 18, 2023 2:20 pm

Cash is King wrote: ↑Sat Mar 18, 2023 1:37 pm Some people are perfectly happy to follow the advice of folks like Ben without knowing what they own. Again, each to their own.

He's said numerous times he holds tilted DFA global equity.

Who is he? Watchnerd or Ben? I'm not familiar with that fund. Why is this a good fund to own?

Ben. It's a globally diversified portfolio tilted towards smaller, more profitable, lower P:E (cheap) companies. It's not available on it's own, but a portfolio with the same characteristics can be constructed using DFA or Avantis funds. That's generally how my portfolio is structured.

Cash is King wrote: ↑Sat Mar 18, 2023 1:37 pm Some people are perfectly happy to follow the advice of folks like Ben without knowing what they own. Again, each to their own.

He's said numerous times he holds tilted DFA global equity.

Since I have a factor-tilted portfolio, it's sort of a happy medium to me. It's still low-turnover, fairly passive and tax efficient. I'm convinced there's enough evidence shifting some allocation from large growth to small value improves diversification, overall returns, and return consistency. That said, the logic and simplicity of a simple MCW portfolio is compelling, esp with automatic re-balancing single funds like Target Date and Life Strategy. The behavioral benefits of MCW may actually be the biggest boon. I agree, esp since research shows less money focused people tend to be happier. With a Target Date Fund in a ROTH, you really can just set it and forget it and enjoy life without being overly focused on money. In fact, when I rea...

When I get into threads where someone asks for portfolio allocations, I recommend for a stock portfolio a range of 20% to 50% in International Stocks. 20% is what John Bogle recommended for a maximum, 30% seemed to be the "sweet spot", 40% is what Vanguard holds in their LifeStrategy portfolios, and Paul Merriman recommended 50%. My International Stock Allocation recently was about 28% of my Stocks. I find it amusing that people feel they can indulge in active management decisions when it comes to domestic / intl allocations, but yet also believe active managers don't beat the market and thus advocate for indexes. Since I have a factor-tilted portfolio, it's sort of a happy medium to me. It's still low-turnover, fairly passive an...